A new 24/7 Wall Street report reveals that only four states are poorer than Kentucky.
Kentucky’s poverty rate of 19.4 percent in 2012 was much higher than the national rate, which is less than 16 percent; median income is under $42,000 a year – more than $9,000 below the national median.
Other key indicators of the commonwealth’s continual swim upstream in the River of Poverty include our jobless rate of 8.4 percent in August – more than a full point above the national rate – and the fact that only two other states hand out food stamps to a greater percentage of residents.
Some say more government programs and mandates will solve the poverty problem.
In a recent Bowling Green Daily News story, Cheryl Allen, CEO of Community Action of Southern Kentucky, told the newspaper that income disparity is “why we can’t improve the poverty statistics.”
Allen criticized a recent proposal in Washington to cut food stamps by 5 percent, claiming that it would force the poor to “decide whether to cover housing or be homeless, put gas in their car or quit a job, feed their family or steal to get that food.”
But is the solution for government to implement the very policies that would harm those Allen purports to help?
Food stamps, minimum-wage increases – which she also expressed support for – and other government-induced programs have repeatedly failed to create opportunities for prosperity that would actually close those income gaps Allen frets about.
There are better ways for Kentucky to address its challenges.
At a recent event previewing the 2014 session of the Kentucky General Assembly co-sponsored by the Bluegrass Institute, State Budget Solutions (SBS) and George Mason University’s Mercatus Center, SBS president Bob Williams urged lawmakers to do what his home state of Washington did a decade ago: priority-based budgeting.
Williams said this approach moves away from focusing “almost entirely on inputs” – how much money do we need to sustain current programs and expenses – to the harder, but more effective work that requires lawmakers to determine core functions and allows their agreed-upon priorities to determine spending decisions.
The ripple effect of such an approach would result in Kentucky legislative leaders moving away from the horse trading that now goes on behind closed doors at the end of drawn-out, drama-filled legislative budget sessions, and instead would use taxpayer dollars more carefully. It also would provide a better way of determining which programs truly help the neediest among us.
It also would reduce the “stupid tax” forced upon taxpayers by politicians’ undisciplined spending decisions.
Williams offers this example: “Here we have a city, Detroit, in bankruptcy, and what did the legislature do – the conservative legislature and the conservative governor of Michigan? They’re funding – with public dollars – a new hockey rink in Detroit.”
Every legislator in Kentucky would benefit from Williams’s experience with “reality-based budgeting,” as he calls it. Such an approach helped his home state of Washington eliminate a $2.8 billion deficit without raising taxes in 2003. Find more about how that happened at www.statebudgetsolutions.org.
There are other ideas, as well.
As a Bowling Green city commissioner for two terms beginning in 2005, Western Kentucky University economics professor Brian Strow, Ph.D., led the effort to implement a zero-based budgeting process that helped the city weather the coming economic storm.
Strow endorsed Williams’s approach for state government and described his own approach as a commissioner this way: “We made all special interest groups testify before the commission to justify spending on their behalf. It revealed areas that really were low priority were getting funded over areas – like alley repaving – that really needed it. By moving money toward the city’s basic needs, we were in a better position to handle the economic recession.”
Whether you call it priority-based, reality-based or zero-based, processes that limit the size, scope and cost of government are healthy for taxpayers – both in terms of costs and services.
History also proves they are the better ideas for pulling Kentucky out of the River of Poverty and through economic storms.
Jim Waters is president of the Bluegrass Institute, Kentucky’s free-market think tank. Reach him at firstname.lastname@example.org. Read previously published columns at www.bipps.org.
A new 24/7 Wall Street report reveals that only four states are poorer than Kentucky.
The Case of the Unhappy Robber
Norton, a professional burglar, looked upon himself as a kind of Robin Hood. The difference was that he took from the rich and kept it for himself. As a result, he spent more time in the slammer than he did in Sherwood Forest.
The toughest blow he suffered, however, was inflicted by the commissioner of motor vehicles. Upon Norton’s release from jail for the umpteenth time, the hard-hearted commissioner revoked his driver’s license.
Dream becomes reality only when you persevere
A young boy grew up in Berea, in a family that was blessed with a variety of musical talents.
His mother was a member of a female group who performed onstage regularly at Renfro Valley, in Rockcastle County.
This young man would routinely attend shows to watch his mother, and other artists, perform on stage. He was eager to learn from them every chance he could. He knew from a young age he wanted to pursue a career in the music industry and was willing to seek advice and mentoring from those who were experienced in the industry.
SOAR-ing in eastern Kentucky
By the time many of you read this, I’ll be traveling to southeastern Kentucky, on my way to the SOAR Summit scheduled for Monday in Pikeville (at least if the weather cooperates).
I’ll be listening to WMMT radio out of Whitesburg, the world’s most eclectic radio station. I’ll be among those magic mountains and with the wonderful people who live in the region and others who don’t but still love it.
If you don’t know eastern Kentucky, get rid of your stereotypes right now. Yes, there are poor, ignorant people in eastern Kentucky — just as there are in New York City, San Francisco or London, England.
Farming Misunderstood and Under-appreciated
As you look at your (I hope) full plate this Thanksgiving, take a guess at what percentage of your annual income you spend on food.
Whatever you guessed, you probably guessed too high.
“We pay as low as 6 percent,” Tom Vilsack, the secretary of agriculture, tells me at a conference table in his office. “In most other industrialized countries, it’s 20-25 percent.”
And if you were spending that much on food in America, Vilsack asks, “how big a house would you have? How nice a car?”
Recalling the day JKF died
This is written on the 50th anniversary of President John F. Kennedy’s assassination. A year ago I demonstrated my exquisite sense of timing: I wrote my personal remembrance of that dark day in Dallas last year on the 49th anniversary of the horrific events in Dealey Plaza.
Is the pipeline to career advancement broken?
“Honey, have you checked our financials this month?” An individual asks their spouse.
“Yes, and it’s not looking good. Our investments aren’t growing like we’d hoped, and the healthcare crisis is affecting the premiums and co-pays we’re paying every month,” replies the spouse.
The individual asks another question, “Do you think we’ll ever be able to retire?”
The spouse shakes their head and replies, “It doesn’t appear we’ll have that option anytime soon, especially if we want to maintain the lifestyle we have now.”
Life Lessons from lawyers, journalists and 10 years as a columnist
I have little in common with Walter White, the chemistry teacher turned drug lord in the TV series Breaking Bad, but the line about his motivation hit me.
In the decade that I wrote a weekly column, I touched a lot of lives.
At least one man stopped his planned suicide and got help after reading my column. (I still hear from him and he is doing fine.)
Register columnists share room for a day at Telford rehab center
So here we are, coming to you still alive from Telford Terrace Rehabilitation Center in Richmond where I am recovering from two strokes that kept me in St. Joseph’s Lexington Hospital for the better part of last week.
I was transferred to Telford where I intend to learn to walk again.
Memo to Merkel: Tell Obama to Take a Hike
Chutzpah. I believe that’s the word for it.
Just days after learning the Americans have been tapping her phones and taping her conversations, Angela Merkel has been publicly upbraided by the U.S. Treasury for being a bad global citizen.
What did she do to deserve this?
Congressionally Duped Americans
Last week’s column, “Is There a Way Out?”, generated quite a few responses, some a bit angry. Some people were offended by my reference to Social Security and Medicare as entitlements or handouts. They said that they worked for 45 years and paid into Social Security and Medicare and how dare I refer to the money they now receive as an entitlement. These people have been duped by Congress and shouldn’t be held totally accountable for such a belief. Let’s examine the plethora of congressional Social Security lies. I’ll leave the Medicare lies for another column.
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